The past few years saw an explosion of new ventures, fueled by the availability of funds even for very early stage companies. But now, the base of the startup funding pyramid is shrinking, which could adversely impact the pace of creation of new ventures.

The number of angel and seed investments made in the first half of 2017 (January to June) is down to 260, a sharp drop from 419 in the first half of 2016, according to data from startup analytics firm Tracxn. Seed funding has seen a particularly steep decline, from 278 to 152.